Market report 16.12.2022

This was probably the last really active trading week in Europe. Next week, all market participants will probably be busy making the last preparations for the end of the year and then say goodbye to Christmas. So those who wanted to make the necessary preparations for the new start into the new year with regard to the supply of raw materials were active this week. For the most part, this is certainly to the benefit of the sellers, because a certain degree of certainty for prices and quantities for the start of the year is certainly also in their interest. The talks were by no means easy in Europe. The tanners expect further and significant price reductions and this is of course not very attractive news for the sellers. This made the discussion extremely difficult and not successful in every case. Especially on the Italian market, the discrepancies in the ideas between buyers and sellers were particularly pronounced. In many cases the talks could not be brought to a successful conclusion and were either broken off or postponed again until the next week. In Asia, the main focus is on the consequences of the sudden end of the zero covid policy. On the one hand, relief is palpable and tangible among many people, and on the other hand, the rapidly rising infection figures bring many

The kill

The kill is now down significantly after all, and slaughterhouses are reporting clearly below-average meat sales for the holidays. We do not see any recovery next week either and very low productions are already announced for the last week of 2022. Traditionally, the start of the year also tends to be characterised by low numbers, so we expect very low production levels for several weeks.

What do we expect

We do not expect any more major market activity next week. Only Asia could still provide surprises, when buyers may want to take the opportunity that their European colleagues have already withdrawn from the market. It will only be interesting to see whether the large differences between the prices that Italian tanners in particular are currently signalling to the market and the sellers’ expectations can be bridged in any way. There are many other problems to solve in the leather industry at the moment besides leather demand, and this does not seem to be particularly conducive to prices or demand for the beginning of the new year what will then wrestle with the expected and declining kill and offers.